Water rates for the average single-family household are proposed to go up by about 10.6 percent over the next two years — and the city is serving notice to local ratepayers, beginning with its customers in Ocean Beach.
To explain the need for higher rates, officials with the city’s Public Utilities Department have kicked off an information offensive with community groups, and started Oct. 2 at the monthly meeting of the Ocean Beach Planning Board. If 10.6 percent over two years sounds substantial, it turns out single-family households get off easier than other classes of ratepayers. Include those customers — multifamily, nonresidential and others — and rates go up by an average of 7.25 percent in January and 7.5 percent more in 2015.
The City Council will consider the rate increase at a public hearing Nov. 21. If approved, a homeowner at the average rate of consumption — 1,200 cubic feet of water per month, or 12 HCF — will see the monthly charge increase from $64.20 today to $66.09 next year and $70.99 in 2015.
No increases are proposed for sewer. The proposed rates have less impact on customers who conserve. Unlike multifamily and nonresidential customers who pay a flat rate for each HCF, single-family residential customers pay progressively more as they consume more. Homeowners who limit their monthly consumption to 4 HCF will actually pay slightly less next year, because of the impacts of adding a fourth tier to the billing structure and changes in base fees determined by meter size.
In the 92107 ZIP code, 23.8 percent of single-family households who use less than 4 HCF per month would fall into the new first billing tier. Another
53.2 percent use between 4 and 12 HCF and would fall into the second billing tier, according to figures provided by Brent Eidson, external affairs deputy director for the city’s Public Utilities Department.
The rate increase request is driven by escalating prices from the San Diego County Water Authority (CWA), where the city gets up to 90 percent of its water, said Lee Ann Jones-Santos, the department's deputy finance director. San Diego water customers haven't had a rate increase since 2011, even though CWA raised its rates in 2012 and again this year. The Public Utilities Department absorbed $35 million in increased costs by improved efficiencies, refinancing debt and purchasing less water thanks to better-than-average rainfall in 2011, Jones-Santos said.
The rate increases are also necessary for the credit rating of the department, which is preparing for possible big-ticket projects over the next decade having to do with desalinization, indirect pot-able reuse, and the Point Loma water treatment plant, Jones-Santos said. Credit rating agencies prefer public-utility departments to maintain a ratio of revenues to expenditures, known as the debt coverage ratio, of 1.5.
The proposed rate increases will raise the department’s debt coverage ratio to 1.25, Jones-Santos said.
In other Ocean Beach Planning Board news
• A Town Hall to discuss the Ocean Beach Community Plan Update, a document intended to guide growth for the next 20 years, has been scheduled for Nov. 13 at 6 p.m. at the Point Loma Masonic Lodge #620, 1711 Sunset Cliffs Blvd. The long-awaited environmental impact report that accompanies the plan is complete and available in hard-copy form at the Ocean Beach Library,
4801 Santa Monica Ave., and at oceanbeachplanning.org.
• Drew Wilson has been appointed to represent the board's third district. Wilson said he has been a resident since March and has a degree in City Planning and Urban Studies. A new vacancy in District 4 has resulted from the resignation of Kelly Taing. More information is available at obcdc.org.